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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Legal
Satisfied Customers: 116140
Experience:  JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
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My mother had a car loan and a checking account at the same

Customer Question

My mother had a car loan and a checking account at the same credit union. I was listed as POD on her checking account (we are in South Dakota). The bank is telling me that they can't release the funds until the car sells, and then I'm only entitled to the difference of the sale price and loan balance.
My question is: Is the bank supposed to release that money now or are they able to hold it as they described?
Submitted: 2 years ago.
Category: Legal
Expert:  Law Educator, Esq. replied 2 years ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
You need to get a copy of the loan documents to make sure, but when a credit union makes a loan to a member that loan is tied to their credit union account. Thus, if the loan is tied to the account, they can demand a payoff on the car before releasing the account and that is perfectly legal for them to do.
You need to seek to either buy the car or sell it off, so you can pay off the loan to get the car released if the loan is tied to the account.